Industry:Medical Device Supplier
"DEAR is the perfect growth platform for small to medium inventory businesses."
Better margins and time saved with DEAR Systems + Xero, WooCommerce, Starshipit, and Stripe
Mega Medical says DEAR Systems is the perfect growth platform for small to medium businesses
When people think of success stories, what usually comes to mind are high-flying tech startups like Rocket Lab, or established big brands, like Apple or Nike. But most businesses aren’t like this. Most are small or medium enterprises, often family-owned, and the goods and services they provide are nothing less than what keeps civilization going.
Mega Medical is one such life-saving business. It sells (and rents) specialist medical supplies and medical gas equipment, with an emphasis on oxygen. In a world still dealing with the effects of a deadly respiratory disease that created terrible oxygen shortages, it’s not hard to see how vital this sort of enterprise is.
“We supply a lot of equipment that supports patients and hospitals with administering high grade oxygen,” says Cale Watson, Operations Manager for Mega Medical. “They use it for basic oxygen therapy, or during procedures, as well as providing patients with oxygen in their homes for therapy purposes.”
Founded by Cale’s father, Mega Medical has been trading for over 18 years. Cale worked in the business on-and-off for quite a while, before deciding to pitch in full-time. He saw an opportunity to modernize the business, which could give them an edge in a market that’s often very slow to adapt to change.
“In the medical industry, there are some very old-school approaches from other companies when it comes to servicing customer’s needs,” Cale says. “We’re trying to become the first movers in this industry to be a little bit smarter and better at customer service, to achieve better market penetration and overall growth.”
But realizing that vision wasn’t possible with their legacy inventory software which was, as Cale puts it, “a very, very outdated and poor version of MYOB.” Old processes and archaic software was holding the business back.
“Before DEAR, we were using MYOB desktop accounting software and double-handling from our previous website, which ran on Neto. We’d hoped this would alleviate some of the pitfalls of MYOB, but the integrations were beyond poor. It was just a scrambled mess at the end.”
Of course, one of the best ways to modernize a legacy business and out-compete slower rivals is to embrace modern software, which enables increased supply-chain visibility and better customer service. For this, Mega Medical chose DEAR Systems — which they found by talking to the forward-thinking team at Beanstalk Accountants.
A breath of fresh air
It’s no secret that some accountants can be, as Cale puts it, “a little bit prehistoric.” But there are fast-moving, modern accountants who have revolutionized their practices and their clients’ businesses by utilizing modern apps that all integrate with each other. Cale was lucky enough to upgrade to Beanstalk, who recommended DEAR as the perfect solution to Mega Medical’s multichannel requirements.
“DEAR were able to give us a clean idea of what an implementation might look for our business, because we’re not typically a straight up equipment business. We do a couple of other things on the side,” Cale explains. “It led us to feeling really confident that DEAR was going to meet our needs, and we ran from there.”
Mega Medical’s multichannel model includes direct-to-customer (D2C) ecommerce sales via their website, wholesale selling (B2B) of medical equipment to customers like hospitals, as well as a medical gas supply and rental business to the greater Sydney geographic area.
“We’ve got many different types of customers,” Cale says. “We’ve got strictly B2B equipment sales customers, which might be one of the big hospitals, some of the big chains of dentists, vets, medical centers, and so on. But then we’ve also got the gas customers who we sell and rent gas cylinders to, who might require equipment sales as well.”
Adding to the complexity is the fact that medical equipment is both very varied and highly configurable.
“There are many different types of makes and models of medical oxygen equipment, and there’s many, many, many different ways that you can build the setup of a medical gas system,” Cale says. “That’s the area in which we’re trying to become an absolute specialist.”
Normally, supplying such a complex product would require an enormous amount of manual overhead work. But with modern inventory management software like DEAR Systems, and integrations with market-leading accounting, sales, and shipping software, that burden is vastly reduced.
Just what the doctor ordered
Once DEAR was implemented, the Mega Medical team quickly saw the benefits. One of the first was that inventory counts across their diverse stock were now accurate and reliable. They knew exactly what they had to sell or hire, how much it cost, and how much it sold for, no matter who it sold to.
“Inventory is easily located, quickly picked and packed, and we provide quick responses for purchase orders, and confirming sales orders,” Cale says. Managing the sales order process is now quick and painless, thanks to DEAR’s intuitive user interface.
“We’ve been really impressed with just the order processing. It’s really, really dynamic. You can move through the accounting and fulfillment tabs and it’s really easy to manage. It’s nice to be able to utilize those filters to quickly get a look at particular orders that you want to see at a certain stage.”
This is a huge help to the business, but it’s just the beginning. For Mega Medical, the most exciting win is DEAR’s library of seamless integrations for ecommerce, shipping, and accounting software. Together, this software stack exceeds the capabilities of a full-fledged legacy ERP system, but with more flexibility and customization, and at a much lower cost.
DEAR integrates with Xero, Stripe, WooCommerce, and Starshipit
Mega Medical is using DEAR’s integration with Xero for their accounting, Stripe & eWAY for payment processing, and Starshipit for shipping. They’ve also just had a brand new ecommerce site go live, powered by Woocommerce and fully integrated with DEAR. This powerful software stack has increased efficiency across the board, with a huge reduction in the need for time-consuming manual processes or intervention.
“Coming from legacy software or MYOB, you don’t have that integrated capability,” Cale says. “You’re exporting to third party apps only to have to re-enter some data, fix up a bunch of information. You’re double handling in lots of steps.”
Today, the integration with Xero helps marry seamless inventory management with accurate accounting. “One of the things that drew us to DEAR was its accounting capabilities, and a really quite detailed landed costing system,” Cale says. “It definitely helps us.”
A lot of Mega Medical’s specialist equipment is purchased from overseas manufacturers all over the world, from the United States to Eastern Europe. DEAR can work in multiple currencies, which means the business can see correct margins and exact landed costs on all their products.
“Making sure that we’re seeing the actual cost, not just an average, really helps us because each shipment can be different,” Cale says. “It’s really powerful for us. In other systems, if you’re using average costing and you can’t see the correct allocation of landed costs, which are duties and taxes, you’re going to be undercutting your own profit.”
With accurate costs in their inventory systems being fed through to their accounting system, profit and loss are much easier to visualize and predict. “And that’s the quantifiable difference for us, with DEAR. We can accurately see, per transaction, if we’re going to be meeting our targets or not.”
With DEAR, tax compliance requirements that would otherwise be enormously complex can be easily managed. Another massive bonus for Mega Medical was the fact that different tax rules can be applied per product, as required, as under Australia’s GST regime, some equipment incurs taxes and some doesn’t. The comprehensive integration with Xero means details like this are never missed, and having clean books means invoices can be made out quickly — meaning the business gets paid faster.
“That model is perfect for us. Being able to have our payment gateways and very, very quick reconciliation processing with Xero, being able to see your debtors — making sure that the invoices are pushing through from your equipment side of things — has been really nice. We’re able to put our general business expenses straight to Xero, but then have our stock invoices correctly costed and allocated, down to each individual product. Then those are pushed straight over to Xero and are ready to get paid,” Cale says.
“That integration to Xero has been just so powerful — for us to have all the information, right there.”
Once it’s time to send goods to customers, DEAR’s Starshipit integration has been producing quantifiable wins, with a huge boost in efficiency for what is often one of a product business’ most time-consuming processes. “Our integrated capability with Starshipit is quite strong now. We’re getting very, very clean workflows happening,” Cale says.
The cure for inventory ills
Today, Mega Medical has a business model that others in their industry can only dream of. They’re running a successful multichannel, mixed B2C and B2B operation despite relatively few team members and a highly technical supply chain.
“I don’t think we could have done it with some of these other apps, that just aren’t advanced with their stock management and advanced sales orders,” Cale says. Mega Medical’s market presence is a lot bigger than it would otherwise be, he says, purely because the DEAR-powered system they’ve been able to put in place is light-years ahead of its competitors.
“A lot of other suppliers are really stuck in the stone age,” Cale says. “They can’t send clean dispatch notifications. They can’t communicate with different people in the same organization. They can’t give you accurate back-order information lead times. They’re struggling to do the basics because their archaic systems just don’t have that speed.”
In the medical supplies business, having a B2B portal “would be considered insanely good.” The only other provider to even attempt it, Cale says, is giant multinational Phillips. DEAR has given Mega Medical abilities that, previously, were only available to companies with practically unlimited resources. Now, smaller players have access to a modern toolset, enabling them to be agile while setting their sights on scale.
“At our fingertips, we’ve got the ability to offer B2B with a couple of clicks. It just shows a level of professionalism and convenience that we can offer above and beyond other suppliers — and our brand name in the market will just become stronger and stronger.”
“The perfect growth platform for small inventory businesses”
Cale says the impact that DEAR has had on the business so far comes down to two main factors: margin visibility, and time savings.
With DEAR, sales order profitability isn’t just calculated once a month, or once a quarter. Mega Medical are able to see profit margins on every single transaction, and can see at any given moment how they’re tracking against their targets.
“Ultimately, it’s margins. It’s accurate pricing,” Cale says. “As a business, you want to be able to put a nice figure on the board, and seeing that margin reflected accurately on every single sales order gives you the confidence to know that you’re going to hit that target.”
Increased efficiency has been the second big win. DEAR’s implementation and integration with the rest of their app stack has left time available for what the Mega Medical team would have previously considered “luxury projects” — essential activities that enable further efficiency and increased growth.
“It’s the time saved,” Cale says. “When you’ve got a system that works, you forget about the things that you used to do that you wasted so much time on. And you can just move on to doing the things that your competitors don’t.”
Mega Medical has already reaped significant benefits from a relatively short time with DEAR’s inventory management system and software integrations — and they’re far from finished. There’s a lot more they want to do with the system, but it’s already earned their unhesitating recommendation.
“DEAR really has the level of flexibility and capability of a more advanced system, while being as user-friendly and simple to use as accounting software,” Cale says. “It’s the perfect growth platform for small to medium inventory businesses.”
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